I read a very interesting article on Mineweb this morning that I think the rest of you would find encouraging (I'll paste the link at the bottom of this page). Many junior explorers and miners have lately been announcing cutbacks and temporary stoppages. These are based on recent declines in metal prices and the fears of long term continuation of this situation.
The fact is that the supply of many base or industrial metals was barely keeping up with demand at the time when this present economic crisis occurred. The cutbacks in exploration and mining that are currently taking place is going to place the supply into a deficit. This is because many economies, while slowed, are still being maintained or are simply growing at a slower rate. The demand will outstrip supply after some months.
One other thing to consider is that, due in large part to the rise in the price of oil, the costs of discovery and development of mines have increased considerably. Consequently, mines that used to be able to be profitable at mining lower grade ores of nickel, copper, platinum, etc., find that they can no longer be profitable.
In such environments, the ore bodies with higher grades are going to be sought after in order to profitably mine the metals needed so as to continue to supply the world. As you know, the ore bodies that Noront has been discovering, in terms of grade, are some of the highest grades encountered in the world. They are also of substantial size and/or have been shown to occur in multiples that can be successfully targeted and drilled.
For all of the above reasons, I think we can have a reasonable hope (especially in light of the board's committment to continue to drill high priority targets this winter) that Noront's stock price will significantly increase over coming months as metal prices begin to rise again and as additional targets prove to be bullseye's of high-grade nickel, platinum and chromium over significant widths.
Here is a sample quote from the article I found encouraging:
"Lack of exploration and deferred project go-ahead decisions are going to extend the period of tight supplies even further into the future and while markets may be too nervous to support the kind of price escalations we have seen in the past two or three years, we will indeed see price rises and probably fairly substantial ones in the not so far distant future."
Here is the link to click on to read the full article on Mineweb:
http://www.mineweb.com/mineweb/view/...
